Small changes

I wrapped up 2016 on vacation from work, but unfortunately I’ve also been battling a cold almost the entire time.  Since December 27th, cold-induced bronchitis has limited my activity.  My wife jokes that every time I take a winter vacation I get sick, and it’s hard for me to remember one when I didn’t.  Last year. I worked through Christmas and Thanksgiving breaks, and I didn’t get sick.  This year, I’ve been sick twice: After Thanksgiving, and after Christmas.

So while that may seem convincing to some, I think there’s another factor:  consumption of alcohol. Both of these rounds of colds were preceded by drinking a little too much the night before.   There seems to be some research to suggest heavy drinking can affect our immune system’s ability to fight off infections for at least 24 hours.   Maybe it’s common sense that I just had never considered…

After I factor in the expense of drinking, I have decided I’m going to curtail my drinking for both health and financial reasons.  There’s probably at least $1,500 annually (and maybe upwards of $2,500 when I consider all spending) I can cut from my spending on alcohol, which when I think about it is a lot of alcohol.  I have slightly expensive tastes, though, so it’s not like I’m pounding cases of Milwaukee’s Best every weekend.  Of the things I buy, bourbon is $30-$50+ a bottle, craft beer is $30-$60 a case, and wine is about $10-$12 a bottle.  And drinking at a restaurant or bar is just crazy expensive, even the few times a month I do that.

So since I’ve spent a majority of the Winter Holidays not drinking,  I might as well continue the trend.  I think it will have a very positive impact on my overall life.  Having a drink after work or with dinner often relaxes me and leads to an evening of not getting stuff done.  If I’m going to ramp up the side hustles this year, I’ll need to be more productive in the evenings.

I think the benefits from reducing alcohol consumption may also carry over into my real job as well.  I’ll be more active, which should improve my overall health.  More activity in the evenings should lead to better sleep, which will make me better rested for the next day.  It might even lead to more “real” exercise.   So overall, it seems like a good idea, and deep down I’ve been feeling like I drink a little too much some nights, so it’s time for a change.

It’s less a New Year’s resolution and more of a product of having  11 days to think about ways to improve my life and the ability to realize our financial goals.   Regarding the finances, it’s not about the money directly, but more about what the money represents: freedom.  If reducing my alcohol consumption affects that realization of freedom on so many levels, it would be foolish not to change my ways.

In December, I added a Habit Tracker to my notebook.  It looks like this:

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December Habit Tracker

I found it useful and enlightening, and I plan to continue it’s use over the coming months.  If you’re working on creating some new habits in 2017, perhaps a similar tool will be helpful to you.  Whether it’s in a notebook, on a piece of paper posted on your wall, or maybe even on a chalkboard in your kitchen, visually tracking your adherence to your targeted habits can be very beneficial in cementing the change.

Whatever you choose to use, find a visual way to track your goals and progress towards them.  If you do, I bet you’ll find you hit more of your targets in 2017.

 

 

End of year update on the Sailing Dream

Step by step, we’re getting closer to realizing our dream.  We just made our last mortgage payment of 2016.  Since refinancing late this spring, we’ve made enough progress to be at the three year mark of our amortization schedule.  So that’s 3 years of a 15 year mortgage paid in 6 months.  In respect to our 5 year plan to get it paid off, we’re already 6 months ahead of schedule.  If we maintain this pace, the house is paid off in December 2018 – two years from today!

And as if that’s not motivation enough, I stumbled across a Craigslist posting for a CAL35 sailboat.

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Picture from the Craigslist post for a 1983 CAL35 sailboat

The CAL35 was on the shortlist of potential affordable sailboats for us to live on as part of the dream when it was first defined.  We’re in good enough financial shape that we could buy this one right now if we wanted.  I mentioned I saw it to Mrs. Outspoken, and she seemed a little excited too, then responded that she’d rather get the house paid off first. I agree.  Plus, we can’t use a boat this size around Pittsburgh due to the mast height not clearing many of the bridges in the city.  It’s more of a coastal/Great Lakes/Carribbean cruiser.

We have decided to take the vinyl/book selling and try to ramp it up next year, focusing more on the vinyl.  I’m making about 3x the profit on records, although it requires a little more work to clean and grade them.  As long as it stays relatively fun, the work won’t be so bad.  Hopefully we can make a little extra as insurance to getting the house paid off by the end of 2018.

Then what?  We’ll we’ve started down a path of gradually transforming our lifestyle.  We decided that buying a canoe is a good first step to start creating more of a focus on spending time on or around water when we can in 2017.  We’ve saved up some money from our Christmas budget and gifts to fund the purchase.

The next step would probably be those sailing lessons in 2018.  After the house is paid off, we probably would need to take some extended charters in a couple locations we’re dreaming of visiting via sailboat.

We’re not entirely ready from a financial perspective to retire.  Getting the house paid off would relieve much (almost all?) of our financial pressure, and then we’d have to decide where to invest over the coming years to reach financial independence to support a potential sailing lifestyle.   My retirement calculator at work says I’m good to go at age 50, but it will come down to what else is happening in our lives at that time.

I’m also going to really take a look at my spending on alcohol.  I enjoy decent wine and whisky, as well as craft beer, but some months I spend way too much.  Also, the only two times I’ve been sick in the last year (both this month) were after a night of drinking a bit too much.   So for my personal health as well as our financial health, I need to cut back, and cutting the spending by 50-75% should make that happen.

As i discussed in an earlier post, we could cut back a little more.  But I think we’ve done a pretty good job of changing our future outlook.  Sure we could get there (wherever there is) a little faster by doing some extreme things, but I can’t say it would be worth it.  But I do wish I’d started this sooner, which is why I gave a copy of Dave Ramsey’s Total Money Makeover to my niece last year at Christmas, and to her brother this year.  I’m also probably going to send them a few tweets in the coming weeks about Mr. Money Mustache.  If I can get one or both of them to see a different possibility for their future, that would be more satisfying than me getting to my destination of Financial Independence a few months earlier.

Whatever it is you want to do, it’s very likely you can do it if you put a clear plan in place.  Start with the “Why”, as in “why do we want to do this, to make these sacrifices or changes?” Then create a vivid visualization of what it would look and feel like to achieve that “Why”.   Next identify what needs to happen to get there, then lay out the simple, often very small steps to make it happen.  For example, why would we buy a canoe if our dream is to sail the Caribbean, Great Lakes, and maybe even the European coastlines?  Because it’s the next small step.

As 2016 comes to a close, take the next step.  Whatever it is, just commit to the next step on your path to achieving your dream.  Every great journey starts with taking the first step.  Where will that first step take you?

 

 

I’m not fine….

After my post about Dreaming Big, someone shared a comment via Twitter about Mel Robbins’ TedX talk.  I had expected to be something about chasing your dreams or creativity, but instead I got a nice insight to psychological tendencies and motivation.  I liked it so much, I’ll probably share it with me team at our next staff meeting.  Because of the video, I was awake earlier today.  If you’re wanting to make a change in your life, watch this video.

 

My first thoughts were about George Carlin’s skit regarding being “Fine”.  His was funny.  Ms. Robbins’ talk is funny and truly insightful.   In order to act on an idea, we must not only do something, but we must do something quickly.  Think about how often you do something, even just a small thing, but it eventually leads to a big change.

Let’s take the example of my camera collection.  After realizing I had 21 cameras, I decided to get rid of a few.  Then I bought a few more.  But the simple act of starting to sell and give away a few of them triggered a big change.   I’m down to four – all of which I haven’t specifically written much about before:  a Minolta Maxxum 7, a Hasselblad 500C, a Bronica SQ-Ai, and a Zeiss Ikon Contina.   At this point, I expect the Bronica to leave eventually.  I’m even selling my trusty Maxxum 5’s.  All of this in 6 weeks.

They’re just cameras, but I had gotten into the habit of searching out interesting cameras.  Of course now I’m drooling over Minolta AF lenses.  So I’m not fine with the change, but I’m growing.

What if I could take the next step towards financial independence?  I’ve been dreaming of riding a bike to work for 6 years.  Exercise, fresh air, and a commute all in one activity.  Plus it saves money.  Moving closer to work might allow me to do that, plus be home more.

Then there’s the time: even my modest 20 minute commute adds an extra 4 weeks of working time to my year.  20 minutes each way is 160 hours per year.  Moving within 5 minutes of work would be like getting an extra 3 weeks of vacation time!  No wonder my hour commute at previous jobs was killing me, and all the flights and waiting in airports were draining my energy.

Think about this: my wife drives 75 minutes one way!  She only works 180 days per year, but the commute in time alone is like working an extra 11 weeks each year!  Oh my word!  Then if we think about wear and tear on a vehicle, or both cars, plus gas.  How soon could we retire? It’s probably $150k or more every 10 years.  I could do the math, but I’m already wound up enough at this point….

I’m not fine.  They say what you don’t know can’t hurt you. Whoever ‘they’ are, they’re wrong.  What you don’t know can kill you, or least steal your dreams.  I’m not sure I’m OK with the amount of sacrifices we’re making to live they way we live.  Maybe we need to consider another change to get to our dreams sooner.  If we both decide to take that step, it might be scary, but it won’t be the end of the world.  Who knows?  It might open a whole new world.

So much is possible.  We don’t need to live average lives.  In fact, I don’t feel like my life is average – but it’s not as excellent as it could be.  Maybe 30 years ago this wasn’t possible.  Maybe society really has changed enough with technology that we truly can have even more freedom than ever before. Perhaps it’s just the availability to get all the individual perspectives and knowledge that makes it seem more real, and people have been doing exactly this for decades.

Has this possibility always been there, but it’s just something else “we didn’t know”?  I honestly don’t know, but the thought of this level of freedom is awesome and invigorating, and a little aggravating at the same time.  I’ve got to do SOMETHING to capitalize on my piece of freedom and make the most of this awesome life that was just so highly improbable to even happen.  All of us are in the same category of uniqueness, and we are meant to do so much more than what the average person does.

Ignore the media and the daily news.  Dream big, then do small things to move towards your dreams.  Even something as simple as giving an unused possession like a camera to Goodwill can get the ball rolling.

Don’t be afraid to Dream Big

Somewhere along the way from the beginning of our school years to when we become adults and start working towards retirement, it seems like a lot of us forget how to really pursue our dreams.  We are doing something, but I’m not sure many of us are actually pursuing a specific dream or set of dreams.

I wouldn’t trade my first 20 years of marriage for anything, but I’d love to go back to 1995 or so, when we had been married a few years with the knowledge I have now about life, money, and the possibilities that exist for early retirement.  The whole idea of what I thought was the American Dream, to own a house, drive nice cars, and retire at age 65, has sent us down a much longer path than what we could have taken.

By 1995, I started focusing on retirement.  I wasn’t putting a ton of money in, but by 2000 I was in great shape, especially if I was thinking about retirement being another 35 years away.  My wife was focused on getting into the school systems, and the thought of a pension was a driving factor.  Investing for retirement wasn’t a priority for her.  A few of those years, we drove over 60,000 miles combined.  How much money did that really cost us?!?!

I’m not sure we would have found a better path to the incomes we’re earning now, but we have increased our lifestyle some as the income rose.  Mostly in housing, and somewhat in other areas like food, cars, and clothing.  We have a fine, typical lifestyle, but I wonder how much differently we could have done things if we knew what we know now?  We’re already more conservative and more “boring” than many of our friends, but what if from 1992-2012 we were pursuing the dream we’re pursuing now, the one of early retirement?  Could I have retired at 35 or 40 instead of maybe semi-retiring at age 50?

A few months ago, I came across a blog called Mr. Money Mustache, or MMM.  I don’t remember how I stumbled across it, but it was probably in preparation for the Legacy Journey class we were leading.  MMM sums up what it takes to retire super early in one post.    He would call my wife and me complainypants, because at this point we’re not selling our home and moving within walking or biking distance of where I work.  But deep down I sort of want to; the neighborhood beside where i now work was an area we dreaming of living in 1992.  Just a couple miles away is a great neighborhood we almost bought a house in back in 2009.  In between the two is an area we dreamed of in 2006.

Where we live is probably our biggest deterrent to early retirement. If we could make the move, we could probably either pay cash or pay off a house withing a year or two in one of those neighborhoods above.   I could stop driving my car much, and sell at least one car of the three we own.  Maybe two.  After that, giving up cable and reducing our spending on food would really be the last two things on our list.  We could probably be truly financially independent in 5 years instead of semi-retired.

I’m not complaining, things are pretty good.  Especially with the focus we’ve had the last four years about being intentional about dreaming and then pursuing those dreams.  But what if we’d been dreaming of retiring at age 40 since we got married?  What choices would we have made?  Why in the world didn’t someone tell us what was possible?   Why didn’t I get some sort of sage advice in high school from other than something like “you need to stop dreaming so much; most people just can’t be something they’re not.”  It was like since we are born into where we are, we can’t really change the course of our life.  What utter crap!

Many of us are made to fear failure.  To be afraid of what others will think if we don’t follow the herd. MMM is not the only place to learn about retiring really early.  jlcollinsnh, Afford Anything, 1500 Days, the Frugal Woods; all share recipes and recommendations for really pursing your dreams.  Don’t live someone else’s dream for you!  No matter how old you are, but especially if you’re young – take some time his month and really think about what you want from this life, then put a plan in place to go get it!

Update on Sailing Away

To paraphrase the old quote from Eisenhower about planning:  Plans are useless – it’s the planning that is invaluable.  That’s how I feel about our plan to sail away.  Based on the progress shared in my last update over a year ago, our sailing dream might look like this to many outsiders:

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Inadvertent double exposure – a marina in La Spezia, Italy and the beach in Corolla, NC.  Kodak 400TX 

I’d call that confused, error-prone, and not too pretty, but a little funky at the same time. (I’ll share more shots from that roll in the future.)  But in the last year, we’ve gotten into a much stronger financial position.  The catalyst was really the realization that we were going to be able to save up for a boat pretty easily, and that honestly surprised us.  By looking at our entire financial picture, we came up with a better plan that doesn’t hinge on us loving sailing and force us into a less than wonderful situation if or when we pursue another chapter of our lives.

This isn’t a financial or early retirement blog, so I’m not going to share specifics, but we’ve improved our net worth by about $90k in the last year.  Obviously no one knows the future, but if we can approximate that for a few more years, we might be in the position to pursue this sailing dream and never have to worry about looking back, and also never worry about not having a nice home to come back to on land.

What we’ve done is pay off our cars and student loans, started investing agressively in our retirement plans, and then focused on paying off the house.  We just refinanced to a 2.875% fixed rate from 4.5%, so an extra $325 a month of our payment automatically goes to principal instead of interest, and we’re able to at least double up on payments almost every month.  The house should be paid for in 5 years or less, so that gives us 5 years to build the side hustles into a sustainable income, with that income probably reducing the amount of time it takes to pay off the house since none of that is calculated in our plan.

As far as my side hustles go, one of them I could clear $60k if I worked full time, but we don’t need that much and I enjoy it now – I wouldn’t enjoy it full time due to about 25% of the work really feels like work to me; I think in a few hours a week while travelling it can almost sustain the sailing lifestyle, and probably next summer we’ll start experimenting with doing that while travelling, trying to get the work to generate enough income to pay for the trips.  Maybe eventually I outsource most of it, and then it provides smaller returns, but less effort.  The other I think can generate $60k or more annually with minimal work once we build it to a certain size, so we’re laying foundations this summer and starting to work that in the fall.  Both are media-related, niche gigs.

After the house is paid for, the primary question becomes how much longer do we work?  The short answer might be “at least long enough to buy and outfit a boat”, but it will probably be much more complex depending on family situations.  As we get to a point where we can see the finish line on the mortgage, we’ll pick up the plan of taking sailing lessons and spending time on the water the summer before, and we’ll put more details in place. But my goal is still to be financially independent when I’m 48, and we’re largely on track.  Maybe 49…

For now, we’ll take little sailing cruises, maybe eventually we start doing more destination sailing vacations or something.  But we’re focused on our freedom for now; freedom from debt, freedom from needing a job, freedom from the things that are preventing us from pursuing this dream the way we want to pursue it.  In my eyes, our plan looks more like this:

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Sailboats outside the harbor in Vernazza, Italy.  Shot on Fuji Velvia the day this dream started…

Maybe not Italy (but why not?) – but anchored near a shore somewhere with the open water in the other direction – free to go when and where we want.  Or not go and enjoy where we are a  little longer.  In the interim, we can enjoy the current journey we’re on.

I think that’s the real point: Enjoy the journey; it’s the only life we’ve got.  But consciously craft the destination, and don’t just go along for the ride.

Waking up to chirping birds

I think I got a taste of what early retirement might be like.   In contrast to most weeks, we didn’t have a lot of plans this weekend.  It had been a busy week, I had awaken at 1:30 am the previous morning, and we didn’t feel the need to get moving early, so the alarm wasn’t set.  Somewhere around 6:45, I awoke to the sounds of the birds outside as the sun began to brighten the morning.   We eventually had breakfast outside, ran errands, did some yard work, played with the dogs, cook dinner on the charcoal grill, etc.  Then we went to bed a little after 9 o’clock.

Sunday was almost a repeat:  Wake at 6 am to the sounds of nature, eat breakfast outside, take a long walk with the dogs, do some yard work, go to a party, cook dinner on the charcoal grille; went to bed around 10 pm.  Monday was  similar, but we never had to jump in a car.  It made me really start looking forward to achieving our goal of early retirement.   Sitting around chatting with family after dinner, I mentioned my favorite part of the weekend was waking naturally with no alarm clock.  So started thinking:  Do I really need to get up with an alarm?

So after checking my calendar, I decided that only on Friday do I need to make sure I’m up by a certain time.  So Yesterday, no alarm.  Today, no alarm.  I was up and moving by 6 am again.  Even on Friday, that would be early enough this week, so I’ll probably set it for 6:15 just in case.

Where did this reliance on waking to an alarm start for me?  It started in grade school, and has mostly continued since.  So it makes me wonder:  How much of a disservice are we doing to the kids of today?  Why in the world do kids need to be waiting for a bus at 6:45 am?  Fixing education is the next frontier for Lean, I think.  As i think of this, I realize that for a large part of the last 4 years, I wouldn’t have needed an alarm.  Even without it, I’m up relatively early by most standards.  But yet I continued to cheat myself of sleep pretty regularly due to a habit of getting up to an alarm.

Maybe that ended last Thursday.  That was the last day I used an alarm since I woke up so early on Friday with the solution to a problem at work in my head that came to me in a dream.  Occasionally, I’ll still need to wake early to be at a 7 am meeting, or to catch an early morning flight, but in general I think I’m going to stop using my alarm.

But you know, it just feels so weird.  It’s like I’m doing something almost taboo; like someone is going to come and bust me for NOT getting up at 5am.  I’ll consider this my next step in not being normal and preparing for an early retirement.

(The bird in the picture ate breakfast with me in Perth, Australia.  I’m no good at taking pictures of birds; I need to get better.  But don’t you think this bird looks like he was awaken too early by his alarm clock ?)

 

 

Progress Towards Sailing Away – December 2014 Update

Beautiful grotto at Monterosso - Kodak Ektar
Beautiful grotto at Monterosso – Kodak Ektar

Another month has come and gone, and while we haven’t made much progress financially on the sailboat fund, there is progress none the less.  The most significant event in November happened while I was in France on business.  Mrs. Outspoken has started sharing what started as my dream – to retire early and live on a sailboat –  as our dream, and share it quite openly.

While dancing with some of our friends during our weekly ballroom dancing outing she mentioned the idea and discovered one of our closer friends used to race J22’s on the West Coast when he was younger and has a pretty extensive sailing background.  She talked about our plan to learn about the lifestyle, explore boats, and take sailing classes and he and his wife were very supportive, saying it was a good plan and that it was critical she learn to sail too.

Later that week we also discovered another of our casual acquaintances has three sailboats and was a member at the club we are planning to join next year, and they extended an invitation to use their boats and visit them at their new home on a nearby lake they are currently building. As our network grows and other people share their sailing experiences and say things like “wow, I wish we could do that some day”, MO seems to be getting more excited and is now more interested in the monetary progress as well, even though there’s not much progress to speak of this month.

Current Sailboat Fund balance: $4200

For those paying attention, yes that’s the same as last month.  We made a charitable donation that exceeded what we typically gave annually from the coffee business and had some minor expenses, but I really didn’t have time to do much in November, but the one day I did have was enough to break even for the month.  🙂

Unfortunately it doesn’t quite scale in a linear manner, so full time wouldn’t equal 20-30 times what I did last month.

Aside from money, we also found a hotel for the Miami Boat Show, so we’re going to attend that to check out some sailboats and also attend  a cruising seminar aimed at couples called Two Can Sail.  I still need to book flights, but we’re taking advantage of my points and miles from business travel for work to minimize the expense so no damage to the sailboat fund will be incurred during the planning of this trip!

We’ve also got our membership application printed and ready to complete for Moraine Sailing Club, which seems to have the most comprehensive club in our area and is on what is really the only sailing-friendly lake within and hour or so – Lake Arthur.   Hopefully participating in their Learn to Sail and Learn to Race programs we can gain an appreciation for sailing this year while we work towards finding a boat for us to use to begin spending nights and weekends aboard as we learn.

One final step in November towards our dream:  I’ll be launching a product line soon. I’m not ready to share much yet, but the intent is to generate more independent revenue from multiple streams to support this sailing dream.  We won’t be ready to “sail away” for a few years at the earliest, but we’re still doing this relatively young, so if I can develop a few sources of revenue it should help us sustain the lifestyle once we make the transition.  With this in mind, everything we do needs to be semi-independent of our physical location.

Hopefully I’ll launch in January and I’ll share the info once I get everything squared away, but it won’t be a sales pitch.  I just secured my manufacturer pricing agreement for the products last week, so all that’s left is final “artwork” on the products and then marketing.  This will have a hit on the sailboat fund in the short term, but hopefully adds another 50-75% to the monthly revenue with minimal time investment from us.  If I recoup the investment in 6 months I’ll call it a win.  And then I’ll be looking for the next step to take for income generation.  (Update: Chinese influence rendered our line of Guitar Pedals marginally profitable, the first group was great, but prices dropped by 60% within months as others flooded the market.  We did well on our launch, but decided not to continue).

Keep chasing your dreams.  Once you catch one of them, all the others seem more possible, and you might find more and more of them turn into reality.